SCHOOL reform is back on the agenda. Here in New York, Albany is debating whether to keep control of Gotham’s schools in the mayor’s hands. On the federal level, Education Secretary Arne Duncan has pledged that he’ll use his new pot of stimulus dollars to encourage reform. We need to think about the types of reforms likely to make a difference in students’ lives. Improving teacher quality is at the top of that list.

Because empirical research confirms that teacher quality varies dramatically, our best means of reforming public schooling is adopting policies that lead to improvements in teaching. Any lasting solution to the teacher-quality problem must include revamping the absurd rules on paying and employing public-school teachers. There are some clear avenues for reforming these rules that if enacted would pay big dividends for students. New York has made some important strides, such as experimenting with a bonus program, but the teachers union and others have squashed efforts such as using test scores to help determine whether tenure should be granted.

Teachers’ salaries are now based entirely on two factors unrelated to teaching effectiveness: years of experience and the number of advanced degrees held. Just about any teacher who sticks around for three years is granted tenure and its protections. (Last year only 0.02 percent of tenured public-school teachers in New York City were fired.) Teachers are paid equally whether they teach advanced calculus or gym, and whether they teach in schools populated by advantaged or disadvantaged students. The result is a system that doesn’t reward excellence, protects failure and simply can’t attract the talent necessary to prepare students for the global economy.

Some commonsense compensation reforms would dramatically improve the way teachers are recruited, trained, motivated and assigned to public schools:

* Performance pay. The more effective teachers should earn higher salaries. Linking a portion of compensation to effectiveness in the classroom does more than reward the best teachers: It also encourages laggards to improve.

* Tenure reform. Job protections are a privilege, not a right, and they should never be absolute. Ideally, tenure would be granted only to teachers who are so good that they don’t need job protection.

* Differential pay by subject. In the global economy, math and science skills are becoming more important every day. Increasing compensation for teachers of these subjects would encourage talented new recruits to undergo the more difficult training required to pursue such positions, and would allow schools to compete more successfully for them.

* “Combat” pay. Teachers should receive higher salaries when they take on more difficult assignments. Good teachers often seek out the least taxing environments in part because their pay is the same regardless of where they teach, meaning our neediest students end up with the worst teachers.

These reforms all focus on directing the incentives inherent in any compensation regime toward the school system’s ultimate goals. President Obama and Secretary Duncan have pushed school systems to move toward each of these reforms, and several districts, including New York City and Washington, DC, have made important though limited strides. Adopted individually, each reform is attractive. Adopted in concert, they have the potential to transform teaching and learning in our schools.

Marcus Winters is a senior fellow at the Manhattan Institute, which will host a con ference today titled, “Improving Teacher Quality: Key to Urban Reform.”